Crypto Whales Are Loading Up — Are You?
New research shows the biggest crypto buyers are back. And this time? They could hold for the possibility that Bitcoin will surpass $100,000 in 2024. You don’t want to miss the next massive crypto bull run like we saw in 2020 and 2021. To know exactly what’s going on and what to buy… Get Access To Benzinga’s Best Crypto Research and Investments For Only $1.
Goldman Sachs resumed coverage of Holly Energy Partners, L.P. (NYSE: HEP) with a Neutral rating and price target of $36, given average growth outlook.
Holder expects Holly Energy to generate 8 percent distribution growth in 2017 and 5 percent annually thereafter, driven by accretive dropdown acquisitions from HFC and to a lesser extent base asset growth.
ENTER TO WIN $500 IN STOCK OR CRYPTO
Enter your email and you'll also get Benzinga's ultimate morning update AND a free $30 gift card and more!
"We believe HEP's distribution growth expectation is largely consistent with our broader coverage (2016E-2019E CAGR of 6% vs. 5% MLP coverage) and as such, we do not expect HEP to outperform peers," analyst Jerren Holder wrote in a note.
Given its relatively small organic project backlog, Holly Energy's primary source of growth is from acquisitions.The analyst sees dropdown acquisitions of $250 million/$100 million in 2017/2018 at an average multiple of 8x consistent with historical transactions.
The company has stated it is currently evaluating a potential dropdown of certain assets related to the expansion at HFC's Woods Cross refinery, which it expects to close in the second half of 2016.
HEP primarily support refineries owned by its parent, HollyFrontier Corp (NYSE: HFC). The company generates stable cash flow as its contracts are supported by minimum volume commitments and inflation-indexed fee escalators.
"We estimate its revenue under MVCs account for 70-80% of total revenues. Additionally HEP has a strong balance sheet with 2016E distribution coverage of 1.15x and debt/EBITDA of 3.9x," Holder noted.
Crypto Whales Are Loading Up — Are You?
New research shows the biggest crypto buyers are back. And this time? They could hold for the possibility that Bitcoin will surpass $100,000 in 2024. You don’t want to miss the next massive crypto bull run like we saw in 2020 and 2021. To know exactly what’s going on and what to buy… Get Access To Benzinga’s Best Crypto Research and Investments For Only $1.